Employer's Guide to Unemployment Insurance Tax in Georgia

Everything employers need to know about paying unemployment insurance taxes in Georgia.

If your small business has employees working in Georgia, you’ll need to pay Georgia unemployment insurance (UI) tax. The UI tax funds unemployment compensation programs for eligible employees. In Georgia, state UI tax is just one of several taxes that employers must pay. Other important employer taxes, not covered here, include federal UI tax, and state and federal withholding taxes.

Different states have different rules and rates for UI taxes. Here are the basic rules for Georgia’s UI tax.

Register With the Department of Labor

As a Georgia employer, your small business must establish a Georgia UI tax account with the Georgia Department of Labor (GDOL). To register for an account with the GDOL, use Form DOL-1A, Employer Status Report. You can access and download blank forms by clicking on the Forms and Publications link on the GDOL website. GDOL will review your filing and, if it determines your business is liable for UI tax, it will issue you a UI tax account number. (Most employers are liable for the tax.) Unlike other states, in Georgia there currently is no way to register for a UI tax account online. There is no fee to register your business with GDOL.

Note: To establish your Georgia UI tax account, you’ll need a federal employer identification number (EIN). You can apply for an EIN at IRS.gov. Generally, if you apply online, you will receive your EIN immediately.

Rules for UI Tax Liability

As a Georgia for-profit employer, you generally are liable for state UI taxes if you meet any of the following conditions:

  • your total gross payroll for any calendar quarter is $1,500 or more
  • you employ at least one individual, whether the same individual is employed each day or some portion of a day in 20 different calendar weeks and whether or not the weeks are consecutive,
  • you acquire another business, or substantially all (90% or more) of the assets of another business, that was liable for UI taxes, or
  • you are liable for federal unemployment taxes under the Federal Unemployment Tax Act (FUTA).

The first three listed items are essentially the same rules that apply for federal liability under FUTA. Therefore, if your business is liable under FUTA, it’s likely also liable for state UI taxes, and vice versa. Different rules, not covered here, apply to agricultural (farm) workers, domestic (in-home) workers, and employees of some (but not all) non-profit organizations.

One piece of good news is that state UI tax payments generally can be credited against your FUTA taxes.

Wage Base and Tax Rates

UI tax is paid on each employee’s wages up to a maximum annual amount. In recent years in Georgia, that amount, known as the taxable wage base, has been stable at $9,500. However, it’s always possible that amount could change.

The state UI tax rate for new employers also can change from one year to the next. In recent years, the rate has been 2.7%. That rate generally remains in effect for at least 36 months. Established employers are subject to a lower or higher rate than new employers depending on an “experience rating.” This means, among other things, whether your business has ever had any employees who made claims for state unemployment benefits.

File Quarterly UI Tax Reports and Payments

In Georgia, UI tax reports and payments due at the end of the month following the end of each calendar quarter. In other words:

Quarter

Reporting Periods

Due Date

1

January—March

April 30

2

April—June

July 31

3

July—September

October 31

4

October—December

January 31

You can file your reports and payments online or on paper. It’s also possible to file reports on magnetic media, such as CDs; that option is not covered here. Large employers (100 or more employees) must file online or with magnetic media.

To file online, go to Online Services on the GDOL website. There you’ll find links to file quarterly reports and make payments. You can make online payments using credit/debit cards, e-checks through a third party vendor (for a fee), or by Electronic Funds Transfer (EFT). To file on paper, use Form DOL-4N, Employer’s Quarterly Tax and Wage Report. You can download blank forms from the Forms and Publications section of the GDOL website.

You must file reports even if you pay no wages during a particular quarter. You will be subject to a penalty if you fail to file.

Post a Notice (Poster)

You are required to post a notice (poster) regarding state unemployment claims in places readily accessible to employees. The poster provides basic information on when an employee may be eligible for unemployment benefits and how to file an unemployment claim. You can download a notice that meets all legal requirements (Form DOL-810) from the Forms and Publications section of the GDOL website.

Do Not Misclassify Employees as Independent Contractors

Employers who use independent contractors rather than hiring employees are not subject to the UI tax. However, it’s important that you do not misclassify an employee as an independent contractor. If you do misclassify an employee, you could be subject to penalties or fines.

Using Payroll Service Companies

You may decide that it’s easiest to hand over responsibility for payroll, including UI taxes, to an outside payroll service. If so, keep in mind that your business, or even you personally, may still be held directly responsible for mistakes made by an outside payroll company.

Additional Information

This article touches on only the most basic elements of Georgia UI taxes. Avoid possible penalties for making mistakes by checking both the IRS and GDOL websites for the latest information. GDOL also has a helpful EmployerHandbook that you can download from the GDOL website. In addition to state UI tax, employers have other responsibilities not covered in this article such as federal UI tax, state and federal withholding taxes, required reporting of new hires, and required retention of employee records. You can get more information about other small business tax issues in other articles here on Nolo.com.

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